OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 5 to 7 Higher |
| Soybean Futures: | Mixed |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 8 to 11 Higher |
MILK:
Milk futures are trying to move higher but continue to run into headwinds as spot prices continue to fluctuate without trending higher seasonally. There is sufficient milk for demand. There is no concern over supply tightness, even though butter price is much higher, and stocks are lower than a year ago. Cheese supplies are plentiful. Milk receipts at some plants are beginning to increase as the low point of production seems to have been reached. Margins may be squeezed as the Quarterly Grain Stocks report on Friday was bullish to corn. Hay prices continue to escalate with premium/supreme increase $10.00 per ton in August. With price this high at this time of year, it is likely to continue to increase through the winter. The alfalfa hay price actually declined $1.00 per ton from July, making that category more reasonable but less desirable for milk production.
CHEESE:
Prices are expected to be choppy this week as buyers and sellers accomplish business. Much of the business is being done on an as-needed basis rather than increasing supply for possible demand. Overall demand is in question through the end of the year as retail prices are higher not only for dairy products but all groceries.
BUTTER:
Butter remains in a range at a rather high level. This is not expected to change much in the near term. The concern is whether high prices will impact overall demand, especially after holiday buying is finished. Exports have remained strong but may slow due to the high value of the U.S dollar. However, it will take time for inventory to increase to a more comfortable level.
